The influence of credit, liquidity and non-performing loans on profttability in Commercial Banks listed on the IDX for the 2019-2022 Period

Anthony Wijaya, Agnes Gummer (), Angel Monica, Rosmayanti Rosmayanti, Rafida Khairani and Maya Andriani
Additional contact information
Anthony Wijaya: Prima Indonesia University
Agnes Gummer: Prima Indonesia University
Angel Monica: Prima Indonesia University
Rosmayanti Rosmayanti: Prima Indonesia University
Rafida Khairani: Prima Indonesia University
Maya Andriani: STIE Profesional, Indonesia

Journal of Economics and Business Letters, 2023, vol. 3, issue 6, 82-93

Abstract: This study explores the correlation among non-performing loans (NPL), credit (DER), liquidity (CR), and profitability (ROA). The data used in this investiga- tion were extracted from the Annual Published Financial Reports of 44 Commercial Banks listed on the Indonesia Stock Exchange for the period 2019–2022. The sam- ple selection involved a comprehensive approach, targeting all 44 Commercial Banks listed on the Indonesia Stock Exchange (BEI) during the years 2019 to 2022. Sta- tistical tests, specifically multiple regression methods, were applied for hypothesis testing, utilizing the F-test and T test after conducting conventional assumption tests. The findings indicate that profitability (ROA) is significantly influenced by the interplay of non-performing loans (NPL), liquidity (CR), and credit (DER). Credit (DER) has a discernible impact on profitability (ROA), whereas liquidity (CR) does not significantly affect profitability (ROA). Non-performing loans (NPL) exert a modest and unfavorable influence on profitability (ROA). The coefficient of determination (R2) for this study is 0.139, suggesting that factors beyond the scope of this research contribute to 86.1% of the variance, while variables related to credit, liquidity, and non-performing loans (NPL) can account for 13.9% of the variance in the profitability (ROA) variable.

Keywords: Debt to Equity Ratio; Current Ratio; Non-Performing Loans; Return on Assets (search for similar items in EconPapers)
Date: 2023
References: Add references at CitEc
Citations:

Downloads: (external link)
https://journal.privietlab.org/download.php?id=620 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:prv:jeblpv:260

Ordering information: This journal article can be ordered from
https://journal.priv ... EBL/article/view/260

DOI: 10.55942/jebl.v3i6.260

Access Statistics for this article

More articles in Journal of Economics and Business Letters from Privietlab Research Center
Bibliographic data for series maintained by Mochammad Fahlevi ().